Churn Rate Calculator
Customer churn.
Churn = customers lost ÷ total at period start.
How the Math Works
Churn rate is calculated by measuring the number of customers who cancel their subscriptions or stop using a service over a specific period, divided by the total number of customers at the start of that period. The formula is: (Number of customers lost during period / Total customers at period start) x 100. This gives you the percentage of your customer base that has churned, providing a clear metric of customer retention performance.
Practical Applications
To apply this calculation, track your customer count at the beginning of a month or quarter, then count how many customers canceled or stopped using your service before the period ended. Multiply the resulting decimal by 100 to get your churn rate percentage. For example, if you started with 500 customers and lost 25 during the month, your monthly churn rate would be 5%.
Day-to-Day Use
Understanding your churn rate helps you make better business decisions in everyday operations. A high churn rate signals problems with your product or service quality, allowing you to address issues before losing more customers. You can also use it to forecast revenue, set realistic growth targets, and evaluate the success of retention strategies like customer loyalty programs or improved customer service initiatives.
FAQ
Good SaaS churn?
Under 5% monthly is strong for B2B SaaS.